Phorm Still Looking For A Large-Scale Deployment, Still Finding Investors

from the why-do-they-bother? dept

As a search through the Techdirt archives shows, Phorm's behavioral advertising service based on watching your Web activity was beset by problems in its early days. One of the last Techdirt posts on the company from a couple of years ago explained how Phorm was planning to expand overseas, and here's some news on how that's been going:

Despite Phorm softening the service in response to privacy concerns, three UK ISPs who trialled it decided not to go deploy it. Phorm moved operations to South Korea but the same happened. So it moved to Brazil.

Now operating on an opt-in basis, Phorm has finally gained actual commercial roll-out with Brazilian ISPs Oi and Telefonica and with Romania’s Romtelecom. With them, Phorm says opt-in rates have met or exceeded targets, advertiser prices have been “significantly higher than forecast” while publisher costs have met or undermet targets.

With this record, Phorm could certainly use with a few more big new markets; its financial results so far have been dismal:

The company had never recorded any revenue until the first half of this year, just $17,336. (£10902.53) In 2010, Phorm lost $28.6 (£17.99) million.

Despite that track record, it is predicting big things:

"The potential scale ... of the Brazilian business could be £7.03 ($11.13) million... The (value) of Romania could be £78 ($124.03) million," Phorm itself forecasts modestly to investors. These targets are based on Phorm scaling up from small, post-trial deployment to large-scale adoption.

It also has high hopes elsewhere:

Phorm says discussions with other global ISPs have also continued for the last three years. It plans to roll out in China and a southern Europe country early in 2012. It also says it is due to deploy in a southern Europe country it values at £483 ($768.01) million and a south-east Asian country it values at £82 ($130.39) million early next year.

Those are rather a jump from this year's six-month sales of $17,336. Undeterred by that fact, investors still seem to be piling in:

This time, it is raising £30 ($47.7) million, which will be used partly to repay a £16 ($25.44) million convertible-notes loan it took out this March and partly “to provide sufficient working capital to get to positive operational cash flow”. It is planning a cash burn of £1.1 ($1.75) million per month for the next year.

At this point, you could be forgiven for having lost track of how much money Phorm has raised and how much equity it has given out to finance its ongoing hefty losses. But paidContent has previously reported Phorm took a total £53 ($84.28) million between 2005 and 2010. The recent loan and latest funding bring that total to nearly £100 ($159.01) million.

That's pretty incredible: nearly $160 million for a service that has yet to prove itself in any large-scale deployment. There's something very strange about this persistent belief by investors that what the world is really waiting for is a service that watches your every move online to serve up targeted ads and content.

As a Romanian, this is the first time I hear Phorm is used by Romtelecom.

Anyway, doubt it has any impact. Romotelecom's offering is mostly leased lines (businesses) and ADSL, mostly used in small villages or by people that fall for the advertising (bundling satellite tv and telephones).

Smart people and heavy users use cable or fiber to the premises solutions here.

Phorm Still Snooping On Web Users, Still Trying And Failing

Let's face it... Since the days of PeopleOnPage, Kent Ertugrul of 121Media "fame" has been intent on snooping on others to feed himself and his family. And he has doen well out of the creepy business he is in.

He has, with purpose, snooped and sold his way into the ISPs in the UK (before being kicked out after the uproar by a so called half a dozen determined people, ahem!)

Anyone who has not followed the amazing story can easily google a few terms to learn more about this very poor, low life scum of a business which Phorm actually represents.

Enlightening terms to look up, and learn so much more from include...

- "Kent Ertugrul"

- "http://www.whatdotheyknow.com/search/phorm"

- "stopphoulplay" (this is a really good search term for the Phorm newcomer... Sadly the Phorm company realised the mess that launching "stopphoulplay.com" caused and today it just re-driects to thier corporate site)

- "phorm changes wikipedia" - this is a classic and shows just what Phorm and Kent Ertugrul are like. Yes, they really did change what wikipedia said, even though it was true and accurate...

Finally, this website has a fantastic history of information on Phorm, their crimes against privacy and the extraordinary efforts which the authorities have gone to. Efforts NOT to actually prosecute anyone in the UK for the dreadful abuses of personal and business rights to privacy of communication...

Kent Ertugrul (and his other co-horts such as Norman Lamont) really need to acknowlegde that they are only in their roles to support international espionage. Why are THEY able to make such nice livings out of this and pretend it is a commercial enterprise? It's unbelievable!